Elevating product strategy through advanced competitive intelligence

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TLDR

In this episode of Product Mastery Now, I interview Jay Nakagawa, Director of Competitive Intelligence at Dell Technologies and a 25-year product management veteran. Our discussion reveals proven methods for understanding competitors and developing effective product strategies. Jay shares practical tools and frameworks product managers can use to gather competitive intelligence ethically and systematically. One compelling insight is that looking at competitors through our own lens often leads to misunderstandings – we need frameworks and methods to see the market from their perspective.

Understanding Competitive Intelligence in Product Management

The Evolution of Competitive Intelligence

Jay has an interesting background that shapes his perspective on competitive intelligence. After spending over 20 years as a product manager, he found himself increasingly drawn to analyzing competition and developing strategies to outperform rivals. When Dell acquired EMC, Jay had the opportunity to transform this skill into a new career direction, leading competitive intelligence efforts.

His experience reveals an important shift in how companies approach competitive analysis. While understanding customer needs remains essential, gaining deep competitive insights has become equally valuable for product success.

The Problem with Traditional Analysis

Many product managers rely on SWOT analysis for competitive insights. However, Jay explains that in his field, they jokingly call SWOT a “Silly Waste of Time” because it reveals little about competition. Instead of providing deep insights into competitor strategies and capabilities, SWOT tends to focus on internal factors and broad market opportunities.

Core Functions of Modern Competitive Intelligence

Jay learned about competitive intelligence from the Academy of Competitive Intelligence, which teaches product managers not only frameworks but also how to use them practically. Based on Jay’s experience at Dell Technologies, effective competitive intelligence includes:

Essential Frameworks for Competitive Analysis

Porter’s Five Forces in Practice

Jay shares an example of how to apply Porter’s Five Forces using the large aircraft manufacturing industry:

1. Threat of New Entry
   • High capital requirements
   • Strict government regulations
   • Example: China’s emerging presence in aircraft manufacturing
2. Supplier Power
   • Impact of supply chain disruptions
   • Limited supplier options
   • Complex component requirements
3. Buyer Power
   • Airlines as major customers
   • Long-term purchase commitments
   • High switching costs

Understanding Competitor Perspective

Jay shares a metaphor about competitor analysis: Picture a kitten looking in a mirror and seeing a lion’s reflection. While we see the kitten, we need to understand that the competitor sees themselves as a lion. This perspective helps explain why competitors’ actions that seem irrational often make perfect sense from their viewpoint.

Jack recommends you focus on your primary competitors. Use Four Corners Analysis to understand their market:

1. What’s driving their business?
2. What’s motivating them?
3. How do they view themselves?
4. What do they want to do?

The answers to these questions give you a good idea of what your competitor will do over the next 24 months. Then understand their biases and blind spots that you can exploit.

Advanced Competitive Intelligence Techniques

The Triangulation Method

Jay explains how his team combines multiple sources to build reliable competitive insights:

• Internal Knowledge
  • Team members with competitor experience
  • Product telemetry data
  • Sales team feedback
• Public Information
  • Job postings
  • Trade journals
  • Financial reports
• Industry Intelligence
  • Analyst reports
  • Conference insights
  • Customer feedback

Creative Research Methods

Jay shares an example about a team that used a creative but ethical way to gather competitive intelligence for a pharmaceutical company. The team needed to understand a competitor’s capacity for manufacturing vaccines but couldn’t access internal information. Their solution? They contacted the local fire department to review the building’s fire mitigation plan, which revealed details about the facility’s size and potential production capacity.

Practical Information Sources

Here are specific places where product managers can find competitive insights:

Connecting Intelligence to Product Strategy

Common Product Management Challenges

Jay observes that many product managers have become highly specialized, focusing deeply on specific features or release optimization. While specialization has its benefits, it can lead to:

1. Limited market understanding
2. Missed competitive threats
3. Reactive rather than proactive strategy
4. Insufficient competitive differentiation

Predicting Competitor Actions

Jay shares four common ways competitors respond to market moves:

1. Imitation Response

When competitors can’t innovate quickly, they often try to copy successful features. Jay references Tony Fadell’s experience with the Nest thermostat as an example of how established companies respond to innovative products.

2. Innovation Response

Some competitors will develop alternative approaches rather than direct copies. This often leads to market differentiation and can benefit customers through increased choice.

3. Legal Response

Jay notes that when competitors can’t compete effectively through products, they may turn to legal challenges, particularly around patents or regulatory compliance.

4. Acquisition Response

Larger competitors might attempt to buy innovative companies rather than competing directly, especially when facing significant technical or market barriers.

Evaluating Competitor Claims

Assessing Investment Levels

Jay’s organization looks at publicly available data to figure out the market direction where competitors are going in the next four years. They try to answer the questions, “Why does a company do what they’re doing? Why are they investing in that technology?”

Jay shares a quote from a friend: “Vision without execution is called delusion.” If a competitor claims a particular business objective is part of their vision, you should investigate whether they really have the ability to execute on that vision.

Vision vs. Execution

Drawing from his experience, Jay shares these warning signs of a disconnect between vision and execution:

• Repeated announcements without progress
• Misalignment between stated goals and resource allocation
• Lack of supporting technical capabilities
• Missing market validation

Innovation Through Competitive Intelligence

Finding Market Opportunities

Jay shares how competitive intelligence can reveal innovation opportunities. He uses the example of Tony Fadell’s development of the Nest thermostat:

1. Personal Problem Recognition
   • Cold mountain cabin on arrival
   • No remote temperature control
   • Manual programming challenges
2. Market Research
   • Competitor analysis (Honeywell)
   • Technology assessment
   • User need validation

Conclusion

Throughout our discussion, Jay emphasizes that competitive intelligence isn’t about following competitors – it’s about understanding the market landscape to make better product decisions. The goal is creating differentiated products that solve real customer problems while maintaining awareness of competitive dynamics.

Useful links:

• Connect with Jay on LinkedIn
• Learn more about PDMA

Innovation Quote

“Ideas can come from anywhere.” – based on the story of Tony Fadell, inventor of the Nest thermostat

Application Questions

1. How could your team implement a systematic approach to gathering competitive intelligence that goes beyond basic SWOT analysis?
2. What frameworks from this episode could you start using immediately to better understand your competitors’ strategic direction?
3. How could you integrate competitive intelligence gathering into your current product development process without disrupting your existing workflow?
4. In what ways could your team better utilize publicly available information sources to predict competitor moves?

Bio

Jay Nakagawa is a 25+ year veteran product manager, with a track record of successfully building new products and developing turn-around strategies resulting in high revenue growth. As director of Competitive Intelligence with Dell Technologies, he and his team have been instrumental in providing critical guidance to product management teams providing insights that encompass how to create differentiated offerings to the market.

Thanks!

Thank you for taking the journey to product mastery and learning with me from the successes and failures of product innovators, managers, and developers. If you enjoyed the discussion, help out a fellow product manager by sharing it using the social media buttons you see below.